H&R Block and IBM’s Watson AI Join Forces to Take on Tax Preparation
H&R Block teamed up with IBM’s Watson artificial intelligence (AI) platform to help human tax preparers analyze data and suggest tax filing options in order to provide customers with the greatest tax refunds possible this year. About 70,000 H&R Block tax preparers are currently using the technology to assist approximately 11 million customers with their tax returns, according to Computerworld. The tax preparation company has about 12,000 offices located in the U.S. and prepares 24.2 million tax returns across the globe.
AI Reaches New Heights
Out of the tech giants investing in artificial intelligence, IBM is the first to use it in the realm of tax preparation, according to Computerworld.
“We are introducing something this tax season that is totally new and is in fact a first in the tax preparation category,” said Bill Cobb, H&R Block’s president and CEO, in a statement. “By combining the human expertise, knowledge and judgment of our tax professionals with the cutting-edge cognitive computing power of Watson, we are creating a future where our clients will benefit from an enhanced experience and our tax pros will have the latest technology to help them ensure every deduction and credit is found.”
Watson employs cognitive computing techniques such as deep learning, machine learning and neural networks to make sense of vast amounts of data. And in the area of tax preparation, AI can be particularly useful in keeping tax preparers up to speed with ever-changing federal tax codes and laws. In turn, tax professionals can make more informed decisions for each individual customer based on varying factors like marital status, dependents and capital gains, as Watson uses that information to extract insights on correlating tax implications, according to Computerworld.
“This speaks to Watson’s strengths as a learning machine,” said Rob Enderle, an analyst with the Enderle Group. “Unless you are an incredibly unusual person, there is no way you can know how to optimize a tax payment or return absolutely. There is simply too much information to learn and so much new [data] being created that even if you were able to read and understand it all, by the time you were done, you’d still be terribly out of date.”
Overall, AI technology is poised to play an integral role in tax preparation. According to the source, once the training of Watson is complete, H&R Block should be able to show proof of customer tax savings — a factor that can draw more customers to businesses with AI-powered capabilities.